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To: marc ultra who wrote (681)	9/2/1998 11:47:00 PM
From: Ken Brown	Read Replies (1) \| Respond to of 15132

Of course this is so unlikely that I have no intention of sharpening those pencils for sale I thought that was the other Marc. I'm confused. If I were you, I'd sharpen a few, just in case. On the one hand, the sentiment numbers can help fuel a rally, should one materialize one of these days. Both from short covering, and from bears turning over into the bull camp. OTOH, though, I think you're right about bearish sentiment over 50% possibly being bad. It's the old inverse of "buy the dips", and it very well may keep rallies in check (witness today's action). My concern isn't sentiment, but valuation. The PEs are looking awfully high all of a sudden, with the "R" word being tossed about like it has this week. A "buying opportunity" with an S&P 500's '99 pe of 21? Hmmm. And if "R" happens, that 21 is going to balloon, fast. Ken PS - I'm still 99% long, though you probably can't tell from what I wrote.

To: marc ultra who wrote (681)	9/3/1998 6:12:00 AM
From: Justa Werkenstiff	Read Replies (1) \| Respond to of 15132

Marc: "It is known that when a market turns bullish and bullish sentiment starts to rise that once it crosses above 50% this has often signaled an acceleration of buying as sideline money starts to pour in. I don't know if the same phenomena has occurred on the bear side but if it did one so inclined might say that this crossing to over 50% bearish will now signal accelerated selling in an ongoing bear market." The individual investor is pretty much sitting still in equities at this point. But August is the first month since September 1990 that there have been net liquidations in domestic and international mutual funds of around $3.0b. As a way of comparison, investors put in an estimated $21.5b in stock funds in July. People are adding money to money market funds currently. This should create additional buying fuel at some point.